Agent
Also called: Agency, Principal and agent
A person employed to do any act for another, or to represent another in dealings with third persons; the person represented is the principal. Section 182 of the Indian Contract Act, 1872.
Explained
Section 182 of the Indian Contract Act, 1872 defines an agent as a person employed to do any act for another, or to represent another in dealings with third persons, and the person for whom the act is done or who is represented as the principal. The essence of agency is the power to bring the principal into legal relations with third persons. Chapter X of the Act, Sections 182 to 238, contains the law of agency.
Capacity and creation follow special rules. Under Section 183 only a person of the age of majority and of sound mind may employ an agent. Under Section 184 any person may become an agent as between the principal and third persons, but a minor or person of unsound mind cannot be made responsible to the principal. Section 185 states that no consideration is necessary to create an agency. Authority may be express or implied (Sections 186 and 187), may arise by ratification of acts done without authority (Section 196), or may be found by estoppel where the principal's conduct induces third persons to believe the agent had authority (Section 237).
The agent is distinguished from close relations. A sub-agent under Section 191 is employed by and acts under the control of the original agent, and Section 190 bars delegation of acts the agent undertook to perform personally unless custom or the nature of the agency requires it. A servant works under the master's control as to the manner of work, while an agent exercises his own judgment in bringing about legal relations. An agent is also unlike a bailee or an independent contractor, who acts in his own right.
On the effect of agency, Section 226 makes contracts made through an agent enforceable as if made by the principal in person, and Section 230 provides that the agent cannot personally enforce, nor is he bound by, such contracts, except where a contrary contract is presumed, as where the agent contracts for a merchant resident abroad, does not disclose the name of his principal, or acts for a principal who cannot be sued. Under Section 202 an agency coupled with an interest cannot be terminated to the prejudice of that interest. Examiners test these sections and the modes of termination in Section 201.
What the law says
An “agent” is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the “principal”.
Defines agent and principal
As between the principal and third persons, any person may become an agent, but no person who is not of the age of majority and of sound mind can become an agent, so as to be responsible to his principal according to the provisions in that behalf herein contained.
Who may be an agent
No consideration is necessary to create an agency.
No consideration necessary to create agency
An authority is said to be express when it is given by words spoken or written. An authority is said to be implied when it is to be inferred from the circumstances of the case; and things spoken or written, or the ordinary course of dealing, may be accounted circumstances of the case.
Illustration
A owns a shop in Serampore, living himself in Calcutta, and visiting the shop occasionally. The shop is managed by B, and he is in the habit of ordering goods from C in the name of A for the purposes of the shop, and of paying for them out of A’s funds with A’s knowledge. B has an implied authority from A to order goods from C in the name of A for the purposes of the shop.
Express and implied authority
Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest.
Illustrations
(a) A gives authority to B to sell A’s land, and to pay himself, out of the proceeds, the debts due to him from A. A cannot revoke this authority, nor can it be terminated by his insanity or death.
Agency coupled with interest
In the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them.
Presumption of contract to contrary—Such a contract shall be presumed to exist in the following cases:—
(1) where the contract is made by an agent for the sale or purchase of goods for a merchant resident abroad;
Agent's personal liability on contracts for the principal
Example
Illustration to Section 187: B manages A's shop and habitually orders goods from C in A's name, paying from A's funds with A's knowledge. B has implied authority to order goods from C in A's name for the shop.
For the exam
- Agent and principal are defined in Section 182 of the Indian Contract Act.
- No consideration is needed to create an agency (Section 185).
- A minor can be an agent but is not liable to the principal (Section 184).
- Agency coupled with interest cannot be terminated to the prejudice of that interest (Section 202).
- Agent is generally not personally liable on contracts made for the principal (Section 230).
1,150 questions in the Law Maker question bank use this term. Practise Contract Law questions
Related terms
- PrincipalThe person for whom an act is done by an agent, or who is represented by an agent in dealings with third persons. Section 182 of the Indian Contract Act, 1872.
- Sub-agentA person employed by, and acting under the control of, the original agent in the business of the agency (Section 191, Contract Act). He answers to the agent, not to the principal, save for fraud or wilful wrong.
- Mercantile agentUnder Section 2(9) of the Sale of Goods Act, an agent having, in the customary course of business, authority to sell goods, consign them for sale, buy goods, or raise money on their security.
- BailmentThe delivery of goods by one person to another for some purpose, on a contract that they will be returned or disposed of as the deliverer directs once the purpose is accomplished (Section 148 of the Contract Act).
- ContractUnder Section 2(h) of the Contract Act, an agreement enforceable by law. Section 10 lists what makes an agreement a contract.
- Qui facit per alium facit per seHe who does a thing through another does it himself. The act of an agent or servant, done within his authority, is treated as the act of the principal or master.
Further reading
Checked 6 November 2026. Statutory text is quoted from the Bare Acts library, taken from India Code. See the full glossary.